Western Price Survey
January 30, 2015
Mild weather across the Western U.S. continues keeping both natural gas and power prices in check. With continued above-normal temperatures expected to blunt Western demand, the trend may continue.
Working gas in storage reached 2,543 Bcf as of Jan. 23, according to U.S. Energy Information Administration estimates, a net decrease of 94 Bcf from the previous week. Storage levels are now 14.6 percent greater than a year ago and 3.0 percent less than the five-year average. During the report week, the West withdrew 9 Bcf from stores.
The natural gas withdrawal was 44 percent less than the five-year average for the week, according to Enerfax, which also expects "comparatively light" storage withdrawals in the weeks ahead based on a mild short-term weather forecast.
Over the Jan. 22-29 trading period, Henry Hub gas spot values fell 6 cents to $2.88/MMBtu. Western natural gas prices also moved lower. El Paso-San Juan Basin natural gas values lost the most, down 22 cents to end at $2.55. PG&E CityGate remained the only Western hub to linger above the $3 mark by Thursday, trading at $3.09/MMBtu.
Meanwhile, Western peak power prices generally lost a few dollars over the Jan. 23-30 stretch. Mid-Columbia dropped $3.15, ending at $20.60/MWh. Palo Verde proved the exception, adding 50 cents and ending at $24.75/MWh. By Jan. 30, average daytime prices ranged from $20.60/MWh at Mid-C to $33.80/MWh at South of Path 15. North of Path 15 posted no trades for either peak or off-peak power this week.
Average off-peak prices gained a couple of dollars, with Northwest hubs up $2.05/MWh on average (see chart). Prices by Jan. 30 ranged from $19.60/MWh at Mid-C to $29.25 at SP15.
Peak demand on the Cal-ISO grid reached 29,447 MW Jan. 28, which should be the week's high.
What's ahead: A high-pressure system over California should create above-normal temperatures throughout San Francisco and Los Angeles the first week of February. Some areas of Los Angeles may see daytime highs in the 80s.
The picture for the Pacific Northwest is not as clear, with meteorologists expressing little confidence in the forecast models available. Any possible rain in Washington or Oregon the week of Feb. 2 is unlikely to help the "pitiful mountain snowpack," according to the National Weather Service [Linda Dailey Paulson].
Archives of the Western Price Survey for the past year are also available online.
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